PayPal tool provides checkout at merchant sites

A new tool from PayPal is designed to give merchants the option of letting customers complete credit card transactions on the merchants' own sites--that is, without being redirected to PayPal's site.

The software, Website Payments Pro, allows an individual merchant to control the checkout procedure as PayPal processes the transaction in the background. While the new offering will bring greater customization capability to merchants, it will also be a source of higher fees for PayPal.

PayPal is charging $20 monthly for Website Payments Pro, plus fees of 2.2 percent to 2.9 percent per transaction, along with a flat fee of 30 cents per transaction.

Merchants using PayPal's traditional service pay no monthly fee, and their per-transaction costs are between 1.9 percent and 2.9 percent. They too pay the flat fee of 30 cents per transaction.

Merchants using PayPal's new tool, however, will get a break when receiving orders and credit card payments via phone, fax or mail order. These merchants will have access to something called "virtual terminal," which makes these transactions free. The traditional service charges $20 a month for it.

The new product is being unveiled as PayPal's parent company, eBay, undergoes growing pains and looks for ways to keep its revenue stream strong.

In January, after the company reported its year-end financial results, its stock took a 19 percent hit. eBay had forecast slowing revenue growth of approximately 33 percent for the year, compared with the 51 percent growth it posted for 2004.

Finally!

It's about time. This has been a long time coming. However, it is
also potentially too late. Although I think PayPal will see great
uptake of this new service, the opportunity to absolutely
DOMINATE this market with an unbranded web service was
technically possible several years ago. I'm certain this release is
a result of many requests, it's just too bad they didn't do this
when PayPal was a more novel concept and online transactions
weren't so easy. I personally have already gone through the
process of figuring out how to do this without PayPal, and would
no longer consider their solution as I have invested so much
time and effort into obtaining a merchant account and
developing scripts to use authorize.net, among others, for
transactions.

PayPal needs compition

This is all good but I think PayPal needs some competition, I used them for 4 years and had my (merchant) account cut off with no explanation or the ability to contest this. I think if they want to be an "enterprise / business" solution that they should fix some major internal processes to facilitate doing business with other businesses. I would never recommend PayPal for a single source business income. And I am legal business that has been in operation for over 9 years.